Seattle leaders break ties with Wells Fargo after 'reprehensible' practices
The City of Seattle is breaking ties with Wells Fargo after revelations that the bank opened accounts nationwide without the knowledge of the account holders.
Seattle city leaders were considering taking out a $100 million loan from Wells Fargo to cover a Seattle City Light bond. In a letter Friday, city leaders say they're calling off the contract before it's finalized this month.
Seattle Mayor Ed Murray, Council President Bruce Harrell and Tim Burgess, the chair of the council’s finance committee, sent the letter.
They call it reprehensible that Wells Fargo employees opened accounts without customer approval. The letter goes on to say those actions harmed the bank's relationship with institutional customers like the City of Seattle.
The mayor's office says the city will go back and review the other competitors for the City Light loan.
The city also contracts with Wells Fargo for banking services. The city's average balance in the Wells Fargo account is $73 million, used for issuing and collecting payments. Wells Fargo is contracted to do the city's banking services through 2018, with the option of a five year extension.
The city's Finance and Administrative Services department says how the bank rectifies recent problems will play a role in whether the city works with Wells Fargo in the future.
Here's the letter: